6 September 2012

London 06.09.12 - Venezuelans complain a lot about the creeping authoritarianism of Hugo Chavez, his power-grip, the way he steals elections, mismanages the country's resources and ignores social issues. Undoubtedly, Chavez has squandered the largest windfall of oil income Venezuela has received. Chavez belongs in a particular league, and it's the sole American representative* to the club of petro-dictators. It's a rather unique circle, formed by corrupt thugs from Saudi Arabia, Russia, Africa, and Asia. But if we thought that we had it bad, we only need to cast our gaze across to Kazakhstan, the land of the new Genghis Khan. Genghis Khan's former Mongol Empire is meant to have been the largest the world has ever seen. If Wikipedia is to be believed, it started in "the Central Asian steppes, it eventually stretched from Eastern Europe to the Sea of Japan, covering large parts of Siberia in the north and extending southward into Southeast Asia, the Indian subcontinent, the Iranian plateau, and the Middle East."

The postmodern khan is called Nursultan Nazarbayev. This man has, singlehandedly, built an empire of similar global reach. Where Genghis used to dispatch his armies of feared Mongol warriors in horseback to conquer -through sheer terror- the last confines of Asia, Nazarbayev has refined conquering methods. He does not need armies. Nor his international conquering campaign is based on fear. For he sits atop Central Asia's largest energy resources. So instead of having to rely on military force, he banks on a force way more widespread and formidable nowadays: greed.

Nazarbayev took power in 1991, right after the collapse of the Soviet Union. Before that, he was already the most powerful local caudillo, the only power above him was that of Moscow's appointee, the Chairman of the Supreme Soviet. Nazarbayev's Wikipedia entry states that he was "elected" by the Supreme Soviet, which he already had under control. So he's ruled ever since. Every now and then Soviet-style "elections" take place, and Nazarbayev continues to be "re-elected", with between 95% - 100% of the votes of course. Not long ago, his congress passed a law to declare him "Leader of the nation", which allows him, and only him, to run for office for as long as he wants.

But where Nazarbayev stands apart -with Teodoro Obiang- from perhaps every other member of the petro-dictators club -now that Gaddafi is dead, is in the way he controls Kazakhstan's huge energy resources. For that, he counts on the disciplined collaboration of a number of family members, and frontmen, all of whom owe their ill-acquired, extraordinary wealth to him personally.

After the collapse of the Soviet Union, Kazakhstan had to figure out a way to get the economy going. Initially a wave of "privatisation" saw a number of foreign and local "investors" grabbing State assets at cut prices through the known drill: car salesmen with political connections and without any track record anywhere acquiring multimillion dollar businesses for small change. However, the local caudillo didn't seem too happy to share Kazakhstan's wealth. In a book written by Rakhat Aliyev, former son-in-law and without a doubt another thuggish oligarch that also became phenomenally wealthy simply because of family connections- it is stated that Nazarbayev takes a cut, a percentage, out of every barrel of oil pumped, and out of every ounce of metal produced. It's kind of difficult to take Aliyev's word at face value. However, many of the arguments in his book can be corroborated elsewhere.

Take for instance Kazakhmys, the mining giant, which, according to Aliyev is controlled by Nazarbayev through proxy "businessman" Vladimir Kim. Its ownership structure was the subject of an investigation by Global Witness, in whose Risky Business report the evident conflict of interests and murky structure is exposed. Aliyev's recording of a conversation with Nazarbayev suggest that the latter controls, as he pleases, Vladimir Kim -according to various sources one of Britain's richest men. Kim holds a majority of shares in Kazakhmys through a web of trusts, fronts and dodgy companies scattered across the world. Whatever left of Kazakhmys not owned by Kim and other fakes, is owned by Samruk-Kazina, a sovereign wealth fund that has 56% of Kazakhstan's GDP under its control. The question of just how could Kim, a man of Korean descent who did not inherit a family fortune, managed to enter Forbes' billionaires list is one that very few people, institutions and media seem to be willing to ask (that list is an absolute joke BTW: money-laundering billionaires are as criminal as narco-cartels, will Forbes include FARC anytime soon?). And the problem is that Kim is not the only Kazakh in the list. Other collaborators of Nazarbayev, among whom his son in law, Timur Kulibayev, his daughters Dinara, Aliya, and Dariga -Aliyev's ex- have also taken part in plundering Kazakhstan. Eurasia.net reports "Kazakhstan’s fat cats are together worth nearly $24 billion. Perhaps its not surprising, then, that in a country where the average monthly wage is around $600, some are sounding the alarm about a growing rich-poor divide."

An investigative journalist called Irina Petrushova exposed Nazarbayev's money laundering schemes and billion-dollar bank accounts in Switzerland. That nearly cost her her life. State-sanctioned killings, such as those of political opponents Altynbek Sarsenbayuly and Zamanbek Nurkadilov -perhaps the only man in history to have managed to shot himself three times including once in the back of the head while committing suicide (if preposterous accounts of Kazakhstan's police are to be believed) did not raise alarms in Western circles either. Instead, a parade of high profile politicos, royalty, and businessmen keep finding the way to Astana, to meet with the new khan and try to ensure a slice of the very lucrative Kazakh pie.

Tony Blair allegedly got $13 million -through Lakshmi Mittal- to clear Nazarbayev's image, for which he enlisted Lord Levy and Alastair Campbell. Prince Andrew got his royal flair to work in Astana too, and got £15 million for a house that had been in the market for a while. Bill Clinton got Frank Giustra -who got an uranium concession- to pledge $100 million to the Clinton Foundation right after the trip to Astana. Lakshmi Mittal's ArcelorMittal gets to basically exploit Kazakh miners without any consequences -unsafe working conditions have already caused 91 deaths. Lesar and Cheney ensured Halliburton's participation in the action, and Chevron got in really early in Tengiz. Liechtenstein former Prime Minister, Mario Frick, and his bank, also act as fronts for Kazakh interests. Companies registered in Malta, BVI, Nevis, UK, Gibraltar, Switzerland, Liechtenstein, Luxembourg, Netherlands, Singapore, Malaysia, and Hong Kong hide the true controlling interests behind Kazakh strategic corporations. Interestingly, not even Freedom of Information requests can get to the bottom of it, as Global Witness can attest.

Considering the above then, would it be an exaggeration to argue that Nazarbayev's empire looms larger than that of the original khan? Considering Nazarbayev's reach across the political spectrum, is it not evident that he's managed to crack it? His money is welcomed, everywhere across the world, and everyone who is anyone in politics, or business, is eager to do deals in the god-forgotten Asian steppes. In the case of Nazarbayev, Kazakhstan, and the sudden wealth of a few, it is hard to find voices asking the right questions though. Human rights are systematically trampled. Elections are a joke. Freedom of expression non existent. Political assassinations, torture, illegal imprisonment, persecution, all normal and common currency. Picture the following: industries and assets previously nationalized and under Samruk control, will now be privatised through a "people's IPO", whereby only Kazakh citizens will take part. That's $78 billion in assets right there. As pointed above "in a country where the average monthly wage is around $600" guess who is going to profit from that IPO? Oligarchs 2.0, Kazakh style.

For nearly ten years now I have been chronicling the monumental fiasco that is Hugo Chavez's revolution. But next to Nazarbayev's, next to his thieving daughters and adulterous sons-in-law, next to his cabinet and minions, his businessmen, and collaborators, I can safely say we should feel fortunate. Chavez is single, Nazarbayev has got three wives and children with all three of them. Chavez misspends State money in social programs, Nazarbayev pockets it. Chavez destroys the oil industry, Nazarbayev privatises it and becomes majority shareholder. Chavez jails unfaithful lovers of his daughters, Nazarbayev recycles and promotes them. The sheer brazenness of Kazakh laissez-faire is shocking. This postmodern Genghis Khan is truly something else.

*Rafael Correa, the Castro dictators and Evo Morales don't control equivalent resources. Situation in Brazil, Colombia, Mexico, Chile and Argentina is quite different. Nicaragua's Daniel Ortega, while personally pocketing the petro-aid Chavez sends through Albanisa, does not control significant resources either. The US energy industry is entirely private.

Alek Boyd created Vcrisis.com and started blogging about Venezuela in Oct. 2002. Since, he has worked as an independent researcher, reporter, lobbyist, civil and political rights activist, and has experience in strategic and media consulting throughout Latin America. In 2006, Alek became the first blogger ever to shadow a presidential candidate in Venezuela. In 2009 he gained a MA (merits) in Spanish American Studies (King's College London). Alek can be contracted to do due diligence on individuals and companies in Venezuela and LatAm. Contact: @alekboyd.

Most of the investigations I've published since 2002 are related to individuals and companies with suspect connections to Hugo Chavez's regime, whose actions would've gone unnoticed otherwise. Exposing the $2-trillion dictator is no easy task, and so donations are always welcome.